Thursday March 16th, 2006

Halliburton accused of failing to purify water supply for soldiers in Iraq...Enron trial recesses until Monday morning...Auditors criticize government's handling of post-hurricane Katrina contracts...

Halliburton failed to protect the water supply it's paid to purify for U.S. soldiers throughout Iraq. That's the finding of an internal company report obtained by the Associated Press. The report says that in one instance, contamination had been missed that could have caused "mass sickness or death.'' The report says the Houston-based company failed to assemble and use its own water purification equipment. It also says Halliburton allowed contaminated water directly from the Euphrates River to be used for washing and laundry at Camp Ar Ramadi in Ramadi, Iraq. The report also notes problems at Camp Ar Ramadi last year such as poor training, miscommunications and lax record keeping. It also says the problems occurred at Halliburton's other operations throughout Iraq. Halliburton said Wednesday it conducted a second review last year that found no evidence of any illnesses in Iraq from water. It says it believes some of its earlier conclusions were incomplete and inaccurate. But Halliburton declined to release the second report.

Halliburton today said its KBR engineering and construction business has agreed to sell its Production Services unit to a management group. Halliburton isn't disclosing the sale price. But the oilfield services company says it expects to log a pretax gain of $100 million related to the deal in the second quarter. KBR's Production Services unit offers engineering, maintenance and other services to oil and gas drillers. Bob Keiller--who's the current managing director of KBR Production Services--is expected to become chief executive of the new standalone company. In January, Halliburton announced plans to spin off a minority stake in KBR.


The former Enron executive regarded as a whistleblower in the Enron scandal has earned five-digit fees for dozens of speeches on the failure of leadership at the company. Sherron Watkins said she expects that bounty to continue--whether or not Enron founder Ken Lay and former CEO Jeff Skilling are convicted of fraud and conspiracy. The defense questioned whether her $20,000 and $30,000 speakers' fees would dry up if the defendants were acquitted. Watkins privately warned Lay of impending doom in 2001. She faced cross-examination yesterday in the trial of her former bosses. Watkins has admitted that she improperly sold off almost $50,000 in stock after a disturbing meeting with Lay. The company crashed months later, but she has never been charged with insider trading. The trial--now in its seventh week--resumes on Monday. Throughout the trial all parties have had Fridays off to allow U.S. District Judge Sim Lake to address other cases. This week the judge granted the government's request for an extra day off to accommodate scheduling conflicts with upcoming prosecution witnesses. Prosecutors say they expect to wrap up their case-in-chief by the last week of March. Then the defendants will have their turn. The Associated Press reports both Lay and Skilling are expected to testify. The judge yesterday told jurors that the trial could wrap up by the end of April. The Enron Task Force says the next four witnesses will be J.R. Sult, Tom Bauer, Ron Barone and Ben Glisan.


Former Reliant Energy gas trader Jerry Futch was sentenced by U.S. District Judge David Hittner this week to 57 months in prison for knowingly transmitting inaccurate market information about natural gas trades to FERC Gas Market Report's Inside FERC. that's a private industry publication which publishes monthly index prices representative of the fixed prices companies bought and sold natural gas during specified periods for delivery around the country.


Auditors say the government's handling of post-hurricane Katrina contracts was marked by bad planning and communications. Katrina slammed the Gulf Coast in late August. Several hundred thousand Louisiana residents evacuated to Texas. The Government Accountability Office says officials wasted millions of dollars in awarding contracts. That includes spending at least $3 million for 4,000 beds that were never used. The report says lack of staffing and disorganization in the Federal Emergency Management Agency and the Army Corps of Engineers led to widespread waste and mismanagement.


HEB supermarkets have recalled its entire line of store-branded baby food. That includes Mom's Choice organic baby food. The San Antonio-based supermarket chain announced the recall, saying that a few customers had reported finding pieces of glass inside jars of HEB peas, carrots and applesauce for babies. HEB spokesman Winnell Herron says the reports have been isolated and there were no reports of injuries. But the company decided to recall the entire line out of an abundance of caution because it involves a product for children. Herron says HEB will fully investigate the incidents and work with the companies that supply HEB with its store-brand baby food lines. In the meantime, HEB is offering full refunds.


About 64,000 bottles of Walgreens High Potency Iron Supplement have been recalled because they aren't in child-resistant packaging. Such packaging is required by the poison prevention packaging act. The supplement is manufactured for Walgreens by Inverness Medical Nutritionals Group. Ingesting multiple iron supplements at once can cause serious injury or death to young children. No injuries or incidents have been reported. Walgreens "finest high potency iron supplement'' is printed on the yellow and green label on the brown plastic bottle. The product was sold at Walgreens retail stores nationwide from April 2005 through October 2005. Consumers should keep the product out of reach of children and return it to Walgreens. For more information call 888-698-5032 or visit the Walgreen's or Consumer Products Safety Commission Websites.


Bio photo of Ed Mayberry

Ed Mayberry

Local Anchor, All Things Considered

Ed Mayberry has worked in radio since 1971, with many of those years spent on the rock 'n' roll disc jockey side of the business...